India, which is currently the sixth biggest economy in the world and expected to become the third biggest by 2030, is using blockchain technology solutions across banking, financial services, insurance, land title registry, vehicle lifecycle management, and health record management; for efficiency and safer ecosystem.
In recent few months among so many things in the economic segment, blockchain and cryptocurrency are something that made quite some ripples, thanks to Tesla’s decision to invest a whopping $1.5 billion in Bitcoin, the most popular cryptocurrency. Now, when there are cryptocurrencies, there is blockchain technology, as blockchain is the technology that enables the existence of cryptocurrency.
Speaking in layman’s terms, blockchain technology is a system of recording information in such a way that makes it difficult or impossible to change, hack, or cheat the system. A blockchain can be defined as a digital ledger of transactions that is duplicated and distributed across the entire network. This is a structure that stores transactional records, also termed as blocks, of the public in several databases, known as a chain. The network is connected through peer-to-peer nodes.
In blockchain technology, data isn’t stored in a central server like the conventional storage system, but across a huge network of computers, which is constantly checking and verifying the accuracy of the records. As the experts claim, using blockchain technology minimizes the risk of hacking multifold, making it a secure medium of transaction, especially for banking systems that are prone to hacker attacks.
India, which is currently the sixth biggest economy in the world and likely to become the third biggest by 2030, too is using blockchain technology solutions. In the public sector, most of the takers are in the banking, financial services, and insurance industry; while the public sector is actively using this technology for land title registry, vehicle lifecycle management, farm insurance, and electronic health record management.
Autofintechs spoke to Darshana Jain, CEO of Snapper Future Tech, to learn about blockchain technology in-depth also its various aspects, and how India is coming up on the blockchain map.
Q. What is the current status of blockchain technology implementation in India? Where do you see India on the blockchain map by 2025?
Though blockchain in India has picked up a lot of curiosity and interest especially in the post-pandemic world, it is still in a nascent stage with a huge potential to grow in the next few years. The Indian blockchain ecosystem is expanding slowly to include start-ups, tech firms, and even different government initiatives that are focused on enterprise and blockchain implementation. In 2017, Snapper, one of the early blockchain start-ups, worked with the Andhra Pradesh state government to identify various e-governance use cases on blockchain and developed a blockchain use case on the land records.
Similar trials have been done in Telangana, Kerala, Maharashtra, Madhya Pradesh, and Tamil Nadu, which has its own state-level blockchain strategy. As per government statistics, more than 20 state governments are trying e-governance implementations of blockchain. Even the Indian government is looking at a slew of initiatives. In the next 4-5 years, I see India on the global blockchain map with start-ups, governments, and enterprises using blockchain to solve critical problems in banking, insurance, manufacturing, supply chain, trade finance, and digital identity.
India’s telecom companies, along with TRAI (Telecom regulatory authority of India) are using blockchain to curb the problem of Unsolicited Commercial Communication (UCC) or spam calls and messages.
India’s telecom companies, along with TRAI (Telecom regulatory authority of India) are using blockchain to curb the problem of Unsolicited Commercial Communication (UCC) or spam calls and messages. This is a very big blockchain implementation. India has 900 million mobile subscribers and implementing these solutions on that scale is a huge step.NPCI is developing another large-scale blockchain platform behind UPI transactions. All this shows that India is progressing fast in terms of blockchain adoption and would be among the leaders in the near future.
Q. Despite the enterprise blockchain having immense growth potential in India, is there enough initiative to adopt the technology by Indian enterprises?
The growing blockchain start-ups ecosystem in India is seen to solve very interesting business problems in the areas of agriculture, waste management, and skill credentials. Snapper Future Tech recently worked on an interesting project with Kushal – a Skill India Govt. initiative, where we implemented blockchain to validate the credentials of construction workers.
There are a lot of things happening in this space — India’s recently announced National Blockchain strategy for implementing national level blockchain infrastructure, As per government statistics, more than 20 state governments are trying e-governance implementations of blockchain. Even the Indian government is looking at a slew of initiatives. NITI Aayog, which is the Indian government’s planning commission and NISG (National Institute of Smart Governance) issued blockchain policy white papers in 2019-20.
Ministry of Electronics & IT (MEITY) has issued a national blockchain strategy paper in Jan 2021.
Ministry of Electronics & IT (MEITY), Govt. of India issued a national blockchain strategy paper in Jan 2021 referencing various national, state, and international level policy papers and reports. MEITY also launched a Centre of Excellence called Apiary along with STPI to help start-ups and the government to adopt blockchain technology for smart governance. Snapper Future Tech is part of Apiary’s first cohort of start-ups to work on e-governance projects.
The government proposed a bill for regulating Cryptocurrency and introducing its own blockchain-based Central Bank Digital Currency.
The government proposed a bill for regulating Cryptocurrency and introducing its own blockchain-based Central Bank Digital Currency (CBDC). CBDC will be an interesting move for greater financial inclusion of rural India. There are various initiatives going on at the enterprise level and government level for the adoption of blockchain technology.
Q. How does blockchain increase industrial operational efficiency and transparency?
Industry 4.0, digital transformation initiatives consider blockchain as important as the Internet of Things (IoT) and Artificial Intelligence (AI). Blockchain can bring trust and transparency in the manufacturing supply chain, sustainable sourcing of raw materials as well as inbound and outbound supply chain efficiency by creating an ecosystem of manufactures, buyers, suppliers, banks, and regulatory bodies.
Trust and transparency in the supply chain will solve many issues including return and recall management and warranty of products. Sustainable development is integral for all industrial organizations that want to reduce their carbon footprint in the coming decade. Blockchain could help achieve all the sustainable development goals.
Q. What are the key areas in the Indian manufacturing sector where blockchain technology can be implemented to bring more efficiency and transparency?
As I said, sustainability is one key area in inbound and outbound supply chains. Customers want to trust and transparency in the supply chain and want to know how a product is being manufactured. Is the supply chain sustainable? How are the raw materials sourced?
To scale blockchain adoption in India, education and skill development are most important.
Manufacturing companies working to achieve sustainable development goals (UN SDGs) to save carbon emissions and build a product that is manufactured with recycled materials can greatly benefit from blockchain as can companies using renewable energy in manufacturing plants to offset their carbon emissions. Smart manufacturing, part traceability, asset tracking, asset provenance, contract management, warranty management, and efficient return and recall management are other key areas where blockchain can bring disruptions in the manufacturing industry.
Q. Despite India thriving on digitalization in the banking system, there have been several headwinds the transaction system faces. How can blockchain remove those and make the ecosystem efficient and transparent?
Digital identity, KYC, and cross-border payments are key areas where blockchain can play an important role in the Indian banking system. Cross-border payment settlement takes days and involves huge transaction fees. Blockchain can do this easily in real-time. Recently, SBI started using blockchain-based cross-border payment settlement solutions built on J.P. Morgan Quorum Blockchain, RBI announced CBDC – digital currency based on blockchain. Many major private banks like Axis Bank, ICICI, and DCB Bank are piloting and using blockchain in some of the banking processes.
Q. What are the challenges of implementing blockchain technology in India?
To scale blockchain adoption in India, education and skill development are most important. India’s national blockchain strategy also gives more weightage to education and skill development for blockchain adoption. Also, there are many ed-tech companies helping build skilled blockchain talent to fill in the gap when it comes to required blockchain resources. Snapper Future Tech also has a skill development initiative — Indian Blockchain Institute — to build a blockchain ecosystem by working with universities and engineering colleges to create a robust blockchain force.
Blockchain adoption also depends on how the government strategizes the framework.
Blockchain adoption also depends on how the government strategizes around the blockchain framework and that aspect is really well taken care of in India. NISG, Election commission, Niti Aayog, C-DAC, TRAI, NASSCOM, and other government bodies/departments are all working towards blockchain adoption in India. We should work together as a National Task Force to ensure that multiple ecosystems can operate cohesively.
Q. Speaking about Snapper Future Tech, how has been the funding journey so far? Can you tell us about your expansion strategies?
So far, it’s been good for us at Snapper Future Tech as we continue to see an upward curve in blockchain awareness and adoption not only in India but across the world. The pandemic has also catalyzed blockchain adoption helping companies like ours to gain traction. Last year, we raised approximately $500,000 in funding. We were also chosen to be part of India’s top 10 blockchain startups contributing to Apiary – the blockchain Centre of Excellence recently set up by the Ministry of Electronics & IT, Govt. of India, and STPI at Gurugram.
With the growing demand for blockchain solutions in Europe, we are now expanding and setting up Snapper Future Tech’s EU entity in Ireland. We have also done a couple of collaborations and partnerships in India, the USA, the Middle East, and other parts of the world.
Q. How has been your business in FY21, especially in light of the Covid-19 pandemic?
So far, so good! The pandemic accelerated the digital transformation initiatives. Businesses in the post-COVID era are now looking for digital solutions in the supply chain, waste management, insurance, healthcare, and renewable energy.
In FY21, we worked for customers in renewable energy for mitigating the carbon emission footprint, making supply chain efficient and transparent, healthcare records and credentials solution for construction workers to prove their skill certificate to stakeholder they work and get fair wages in the unregulated industries.